“A welcome progressive move”
The budget is pro-rural, pro-farmer, pro-common man. They have rightly seen the need to increase the income of the people who virtually live on grass roots and are the grass roots of the country. This in itself will generate tremendous GDP. We acknowledge the concessions given for the export sector and simplification of tax administration and litigation. The Finance Minister has gone into great details in the agriculture sector when he has acknowledged the importance of honey in the economy and it is our wish that the sweetness and flavour of honey permeates throughout the economy. He has also promised light to all the villages throughout India in a defined timeline manner. It is a welcome progressive move to give warmth to the rural people.
“Balanced perspective on the economy”
Indian economy has recorded a steady growth amidst the uncertain economic prospects across the globe. The 2016-17 budget offers favourable and stable opportunities for India’s manufacturing sector. Infrastructure sector has received a huge impetus in the budget with roll out of `2.21 lakh crores for roads, railways and other facilities, which will spur manufacturing. `27,000 crores allocation to roadways will boost commercial and earth moving segments. The rail budget proposal to set up 2 new locomotive factories, 3 freight corridors and a first ever rail-auto logistics hub will spur manufacturing and will bring a boost to machine tool industry.
The government’s commitment to empower farming sector and rural areas will surely lead to higher domestic consumption and demand of manufactured goods. I truly feel that government’s initiative and focus to uplift SMEs will account for growth in manufacturing sector as SMEs contributes approx 17% to our national GDP and generates approx 40% of employment. Reduction in corporate tax for small & medium enterprises will aid the production capacity of SMEs. Disbursement of `1,80,000 crores for MUDRA scheme will also ultimately benefit the SMEs. Setting up of National Board of Skill Development by allocating `1700 crores for establishing 1500 skill development centres will ensure availability of skilled manpower for the manufacturing industry. To sum up, budget 2016-17 presents a balanced perspective on the economy.
“Step in the right direction”
The budget seems to be a positive step in the right direction, with tax benefits to start-ups in the manufacturing sector. Revision in customs & excise duty rates would also be beneficial in sectors such as defence production, IT hardware and capital goods.
The MRO sector in aerospace is likely to gain through complete exemption on customs duty on spares imported for undertaking repairs. With the push in aerospace sector that the industry has been eyeing for a while now, this should increase the potential for business. Duty benefits in renewable energy is also a very positive step. Finally, duty exemptions have been reduced on several military equipment, which shall provide a fillip to ‘Make in India’ initiatives as well as a level playing field for Indian manufacturers. The budget’s focus on infrastructure development is another very important and positive feature. I am pleased with the budget. The devil, however, lies in successful execution. I have immense faith in our system as it stands today, to propel India on the path of economic progress, strength and growth.
“Roadmap for futuristic and sustainable growth”
The budget shows immense promise. A net investment of `97,000 crores in the road sector has been proposed and a total of nearly 10,000 kms of national highway has been approved by the government. With this proposed advancement in the infrastructure sector, the country shows that it is now read for the advent of smart transport options. These initiatives are truly the right ones for stimulating the off-highway products where ZF is present and will be glad to contribute.
Additionally, the setting up of 1500 multi-skill training institutes would help auto component manufacturers in acquiring skilled talent. The Finance Minister has also promised to enforce the necessary revisions in Motor Vehicle Act and open up the road transport sector in the passenger cars segment. All in all, we are looking forward to this financial year as this budget gives us the motivation to continue on our path of futuristic and sustainable growth.
“Focussed on growth and development”
It is heartening to note that the Union Budget has given due importance to the agriculture and the rural sector along with focus on infrastructure. The industry welcomes the government’s move to control fiscal deficit for FY16 at 3.9% and FY17 at 3.5%. Setting up of the National Board of Skill Development Certification in partnership with academia and industry will help the industry to get skilled manpower. Changes in customs and excise duties on certain inputs to reduce costs and improve competitiveness of the domestic industry across many sectors such as electronics, automobiles, defence and aviation will support ‘Make in India’. Reduction in corporate tax for small enterprises will aid the production capacities of SMEs. Development of roads, railways and airports will help ease freight movement and create job opportunities.
Allocation of funds for the rural sector will lead to higher domestic consumption, industrial production and demand for manufactured goods. Introduction of entrepreneurship development courses and 100% deduction of profits for 3 out of 5 years for start-ups set-up during 2016 to 2019 will encourage entrepreneurship. In light of the slowing down of global economy the measures suggested by the budget are expected to lead to development, growth and fiscal consolidation.
“Balancing growth with fiscal prudence”
This is one of the most thoughtful, detailed and well-rounded budgets in a long time, with big ideas aimed at addressing the critical and fundamental imperatives of building an inclusive, equitable and sustainable India, by particularly focussing on the vulnerable areas of the society. In some ways, the budget seeks to correct the anomalies in India’s very poor Gini coefficient (which suggests the level of deviation of distribution of income amongst households), where India ranks a poor 135 amongst 187 rated countries.
The budget lays stress on the insightfully selected areas for transforming India with substantially increased allocations on agriculture & farmer’s welfare, rural infrastructure & digital literacy, social sector (health care), education, skills & job creation and massive outlays and investments on roads and power infrastructure, whilst keeping the fiscal deficit number on track. A lot of focus has been on creating sustainable public transport to transform our cities and towns. Overall, considering the volatile global macroeconomic landscape and continuing headwinds, it is indeed a commendable budget and full marks to the FM for chartering out a well thought out course, balancing growth with fiscal prudence.
“Improving ease of doing business”
We welcome the focus of the budget on rural, social & skill development, making it an inclusive budget as also steps, which have been proposed to simplify tax laws and improve ease of doing business. We also welcome the increased investments in railways & highways and hope that the government acts upon rationalising corporate tax & interest rates to encourage the private sector spending.